The Z Pattern

[roni25]

Hi Roni,

In this Article I explain the [B][B]differences[/B] between[B] S/R [/B]and [B]VZs[/B](which a senior Analyst edited for me). You see VZs[/B] act as [B]price magnets[/B]. I am not looking forward for price to react to or hold at [B]VZ levels.[/B] As a matter of fact price usually [B]shoots right through it.[/B] What I’m really looking forward to is that price comes back to that level.

I’m not setting aside S/R levels. I’m simply opening another opportunity to look at price swings.

Best

Kasravi,

In hindsight trading to and from VZ zones seems very profitable in the longer term!
I shall start my hunt for Z patterns at v zones next week but will still trade some S/R levels with the longterm trend!

Best,
Roni

[Kasravi]

[B]
VZ zones seems very profitable in the longer term![/B]

That’s the key here. Trade 4-5 of them successfully per year and you can buy yourself a new house.

Best

[roni25]

That’s the key here. Trade 4-5 of them successfully per year and you can buy yourself a new house.

Best

Kasravi,

What if the VZ zone is against the larger term downtrend would you still take the VZ over the trend? Or like today where there is a nice 4hr Z pattern forming on the gold to short but the VZ zone is long… Take a look.

Best,
Roni

[Kasravi]

Kasravi,

What if the VZ zone is against the larger term downtrend would you still take the VZ over the trend? Or like today where there is a nice 4hr Z pattern forming on the gold to short but the VZ zone is long… Take a look.

Best,
Roni

You are correct in your observation. In heavily trending markets, like when price is mercilessly hammering down. VZs get totally ignored, most of the time. On top of that there wasn’t a ZP to get long on the Gold anyway. Not that I know of.

I understand you want to get [B]the full picture. When can you rely on VZs? When do they dominate the market? [/B]
I rely on VZs when I see an opportunity to squeeze more out of my trade. So I can target bigger gains. I prefer to play VZs on levels that have been prominent in the past. That’s when they are total game changers in the market. Like this trade opportunity that we discussed.

Best

[roni25]

You are correct in your observation. In heavily trending markets, like when price is mercilessly hammering down. VZs get totally ignored, most of the time. On top of that there wasn’t a ZP to get long on the Gold anyway. Not that I know of.

I understand you want to get [B]the full picture. When can you rely on VZs? When do they dominate the market? [/B]
I rely on VZs when I see an opportunity to squeeze more out of my trade. So I can target bigger gains. I prefer to play VZs on levels that have been prominent in the past. That’s when they are total game changers in the market. Like this trade opportunity that we discussed.

Best

Thanks for the info above! So do you always trade with the VZ areas?

[jasperng10]

@roni25

Anyone seen this setup on the EURNZD 4hr chart… its with the larger trend which is still bearing.

looks to me it is not a complete z pattern but there are always times when uncomplete z pattern result reversal as well… it all depends how strict you awnna adhere to the rules

[jasperng10]

waiting to buy gbpyen in h4 . Neat z pattern spotted

invalid trade since the pattern is not in the channel however seems it is retracing abit

[jasperng10]

usd chf second z pattern in last 2 days! possibly trend continuation after breakout !

Update: Gbpyen trade update: entered into this trade … let’s see how it turns out!

[jasperng10]

was trying to find z pattern in lower timeframe like 15min … found one for gbpusd 15m … looks nice.

[Kasravi]

Thanks for the info above! So do you always trade with the VZ areas?

They definitely don’t get ignored.

best

[Kasravi]

@jasperng10

was trying to find z pattern in lower timeframe like 15min … found one for gbpusd 15m … looks nice.

I was looking/working on the 15m tf yesterday too. But must have missed this setup. Good on you!

Looks like you made some serious money overnight on that G/J trade!

Best

[jasperng10]

Trade update gbpyen … woohoo going to hit tp point smooth trade

[roni25]

Ok one crucial question now!

I need to know whether to pay attention to VZ zones and trade in line with them or the larger daily trend!.. What do you guys trade with? I have had a bad week mainly due to confusing trading methods up! Please clarify so I can continue trading with the rules and regulations that need to be adhered to with the Z setup.

So far I have been checking the daily trend and then coming back down to lower tfs and looking for Z patterns that correlate with the larger trend. I have paid no attention to VZ zones.

Please shed some light.

Best,
Roni

[Kasravi]

@jasperng10

Trade update gbpyen … woohoo going to hit tp point smooth trade

Talk about making money while you sleep!

Best

[roni25]

Talk about making money while you sleep!

Best

Hi Kasravi,

PLease clear the air for me on the question above! Sorry for the bother!

[Kasravi]

Ok one crucial question now!

I need to know whether to pay attention to VZ zones and trade in line with them or the larger daily trend!

Ok, let’s take it step by step.
Pay attention to these 3 tactics . They are king!

Next step, once you have an open trade. You can look at where your next VZ lies. If there is any ahead, then target that level as your final profit taking.

That’s it.

A few notes, in order to maximize Value Zone effectiveness;

-If price is trending steep then there won’t be much chance you catch a decent ZP anyway. In other words price shoots through your VZ.

-Best VZs appear where 2 price levels have been revisited many times. Sometimes that could happen in noisy&crampy markets. You’ll notice price zapping traders out of their mid/long term positions left and right. While you can easily trade the VZ magnets up and down. In and out, profit and profit.

-Remember VZs get updated like explained in detail here. That means if you have a position open that has been running for a couple of hundred pips. And you are sitting on a big fat R:R of 1:23 like in here. Then you can or better should change paradigm. Possibly take whats there and give yourself a pat on the back.

Best

[Kasravi]

Hi Kasravi,

PLease clear the air for me on the question above! Sorry for the bother!

My connection just went.

Best

[Kasravi]

Looking at Eur/Jpy Value Zones. Is something to aim for.

Best

[roni25]

Looking at Eur/Jpy Value Zones. Is something to aim for.

Best

I am also looking at the two value zones near the 136.740 mark, So looking for shorts on lower time frames now…

Thanks for the info above also, So you look for the larger trend first and then hunt for the Z patterns and then as a secondary analysis look at where the VZ zone is to target? Makes sense!

[Kasravi]

I am also looking at the two value zones near the 136.740 mark, So looking for shorts on lower time frames now…

Thanks for the info above also, So you look for the larger trend first and then hunt for the Z patterns and then as a secondary analysis look at where the VZ zone is to target? Makes sense!

Go get em’ roni!

Best